Transcript LES Germany Munich, January 23, 2009 Alternative Dispute

LESI Meeting Manila
June 7-10, 2009
Alternative Dispute Resolution
in Intellectual Property and
the WIPO Experience
Erik Wilbers
WIPO Arbitration and Mediation Center
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO Arbitration and Mediation Center
• Purpose:
– To provide information about, and case services for, the
resolution of commercial disputes between private parties
involving intellectual property (IP) and technology, through
procedures other than court litigation (‘ADR’)
• Principal characteristics:
– International
• No ‘home turf’
– Specialized in IP/technology
• Institution
• Procedural rules/clauses
• Neutrals
– Not-for-profit
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
Mediation, Arbitration, Expert Determ.
• Mediation: an informal procedure in which a neutral
intermediary, the mediator, assists the parties in reaching a
settlement of their dispute, based on the parties’ respective
interests and enforceable as a contract.
• Arbitration: a private procedure in which the parties submit their
dispute not to a court but to one or more chosen arbitrators, for
a formal decision based on the parties’ respective rights and
obligations and enforceable as an award under arbitral law.
• Expert Determination: a procedure in which the parties submit
a dispute or a difference between them to one or more experts
who make a determination on the matter, which can be binding
unless the parties have agreed otherwise.
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
Country
Characteristic of Legal System
Average Length
Average Cost
France
- Civil Law
- Unified Litigation
- No specialized courts
- Civil Law
- Bifurcated Litigation
- Specialized court for invalidity
First Instance: 18-24 months
Appeal: 18-24 months
€80,000-150,000 (1st Inst.)
First Instance: 12 months
Appeal: 15-18 months
€50,000 (1st Inst.)
€70,000 (App.)
- Civil Law
- Unified Litigation
- Specialized courts
- Civil Law
- Unified Litigation
- Commercial Courts
- Common Law
- Unified Litigation
- Specialized courts
- Mediation promoted
First Instance: few months –
24 months
Appeal: 18-24 months
First Instance: 12 months
Appeal: 12-18 months
€50,000-150,000 (1st Inst.)
€30,000-70,000 (App.)
First Instance: 12 months
Court of Appeal: 12 months
House of Lords: 24 months
China
- Civil Law
- Bifurcated Litigation
- Specialized courts
Japan
- Civil Law
- Bifurcated Litigation
- Specialized courts
First Instance: 6 months (in
law)
Appeal: 3 months, no limit
when foreigners litigate
First Instance: 14 months
Appeal: 9 months
€750,000-1,500,000 (1st
Inst.)
€150,000-1,500,000 (App.)
€150,000-1,500,000 (House
of Lords)
Not Available
USA
- Common Law
- Unified Litigation
- Specialized court of appeals
(CAFC)
Germany
Italy
Spain
UK
First Instance: up to 24
months
Appeal: 12 + months
€100,000 (1st Inst.)
€50,000 (2nd Inst.)
Not Available
Up to $4,000,000 (1st Inst.)
$150,000-250,000 (App.)
Source: Kluwer Law
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
Intellectual Property Litigation Expense
(U.S.)
$6,000,000.00
$5,000,000.00
$4,000,000.00
< 1m
1 - 25m
> 25m
$3,000,000.00
$2,000,000.00
$1,000,000.00
$0.00
Copyright
Trademark
Trade
Secret
Patent
AIPLA Economic Survey 2005 (M. Partridge)
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
U.S. Federal Court Civil Action Resolution
1%
14%
22%
No action
Discovery
Pretrial
At Trial
63%
Federal Judicial Center, September 30, 2006 (MP)
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
Anticipating IP Dispute
Resolution Needs
•
•
•
•
•
International
Neutral expertise
Efficiency
Confidentiality
Preserving party relationships
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
International (1)
• Intellectual property rights are often:
– Created through international collaboration
– Exploited through international commerce
– Protected in a multitude of jurisdictions
• Intellectual property disputes often:
– Involve parties from different jurisdictions
– Concern commerce in a multitude of jurisdictions
• Court litigation:
– Which court(s) is (are) competent?
– Risk of inconsistent results
• Epilady case: European Patent Office patents infringement litigation
in 9 countries; found “infringed” in 5 countries, “no infringement” in 4
countries
– Time and cost of foreign litigation
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
International (2)
• In arbitration, parties designate a single forum for
resolving the entire dispute
– Comprehensive and consistent resolution
• Rather than patchwork of court decisions
– Neutrality
• No party is forced to litigate in the other’s home country
• International (procedural) standards
• International Enforceability: New York Convention
– 144 Member States
– International arbitral awards to be recognized and enforced like
final national court judgments
– Only limited exceptions
• Mediation is not rooted in any jurisdiction or law
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
Neutral Expertise
• IP disputes tend to be technical/specialized
– Law, technical background (patents, software, etc.)
• Most courts are not specialized in IP (IBA 2005 Survey)
• In ADR, parties control selection of neutral(s)
– Can select neutral(s) with expertise in the relevant legal, technical
or business area
• WIPO Center
–
–
–
–
–
1,500 candidates from 70 countries
Further candidates added in function of case particulars
Broad range of ADR, IP and technical backgrounds
Detailed professional profiles
Used for Center recommendations and appointments
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
Efficiency
• IP covers fast-evolving technology, used in highly
competitive markets
• Often seen as the true cost of litigation:
opportunity/management cost
• Need for efficient dispute resolution procedures
– ADR offers party control (short deadlines)
– WIPO expedited arbitration case example
• Comprehensive dispute resolution
– One procedure, one law, one language, same lawyers, expert
neutral(s), final result (award or settlement)
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
Confidentiality
• Often required in IP/technology disputes
– Examples: patented technology, know-how, reputation
– Except: where public precedent needed
• ADR is a private procedure
• WIPO Arbitration Rules
– Except as agreed otherwise or required by law, all
participants to preserve confidentiality regarding:
• Existence
• Disclosures
• Award
– Specific protection of trade secrets
• WIPO Mediation Rules also prohibit disclosure in
subsequent proceedings
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
Preserving Party Relationships
• IP often developed/exploited in long-term relationships
between partners
– Industry, SME’s, universities
• Arbitration
– Private procedure, agreed by the parties
– Flexible, can be tailored to the parties needs
– Confidentiality helps parties to focus on the merits of the dispute,
without concern about its public implications
• Mediation
– Interest-based, rather than rights-based
– Less acrimoneous
– No real down side: 70% settlement rate; defines issues; shows
risks of alternatives; can walk out; limited cost; has court support
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
Limitations of IP ADR (1)
• Contractual basis
– No obligation to submit to ADR procedure without contract clause
– Difficult to agree on clause once dispute has arisen
– Unsuitable for bad-faith infringement (e.g. counterfeiting)
• Parties must pay fees of neutrals
– Crucial importance of getting value for money
– ADR efficiency and results can make for substantial benefits
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
Limitations of IP ADR (2)
• Outcome binding only between the parties (inter partes)
– No public precedent (erga omnes)
– No general declaration of (in)validity
– No direct office action (registration, cancellation)
• But: inter partes effect proves mostly sufficient
• ICC interim award 6097 (1989) confirming arbitrability
– Japanese claimant asserting breach of patent license by German
licensee, who invoked invalidity of claimant’s patents
– Party agreement:
• Place of arbitration: Zurich, Switzerland
• Contract interpretation: Japanese law
• Patent infringement: German law
– Primacy of party intent in arbitration
– Submission to arbitration is form of free disposal, like rights
transfer or license (‘any dispute involving property’)
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO Center as Administering
Authority
– Contract clauses and rules for IP disputes
• WIPO (Expedited) Arbitration
• WIPO Mediation
• WIPO Expert Determination
– WIPO list of arbitrators, mediators, experts
• Specialized in different areas of IP
• From numerous countries in all regions
– Administration of cases
• Under WIPO Rules
• Under special procedures
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO ADR Options
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO Arbitration Rules
• IP-specific elements
– e.g. Confidentiality, technical evidence, interim relief
• But: WIPO Rules can apply to all commercial
disputes
– Commercial contract may have IP component
– IP contract may cause ‘regular’ commercial dispute
• Combining guidance with flexibility
– Arbitration Rules pre-structure the entire proceeding
– For most part can be modified by arrangement between
arbitrator(s) and parties
• For domestic and international cases
– Bridging/accommodating different legal/procedural traditions
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO Expedited Arbitration
• Main features compared to regular arbitration:
– Shorter procedural timelines
– In principle, a sole arbitrator
• When consider WIPO Expedited Arbitration?
– Value in dispute does not justify the cost of more extensive
procedures
– Only a limited number of contained issues in dispute
• Although difficult to predict at the contracting stage
– Parties urgently need a final and enforceable decision
– Parties wish to commence with an ambitious time/cost frame,
subject to case developments
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO Cases: Legal Basis
•
•
•
•
Domestic and international
Prior clause and posterior submission
Contractual and (occasionally) non-contractual
Arbitration or mediation, or combined (in each
‘direction’)
• Sometimes following court litigation which the parties
had commenced
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
A Few General ADR Clause Pointers
• Use model clauses as basis and modify/extend only
as necessary
– Do not divide per type of right, remedy, dispute, or party
case status
• Combine options, include mediation
– Like court cases, many ADR cases get settled
– Consider suitability of expert determination before arbitration
• If arbitration, ‘make it fit’ (e.g. expedited)
• ‘Institutional’ or ‘ad hoc’?
– Hard to agree on procedure once dispute arisen
– Do you know suitable neutrals
– Which administering institution
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO Cases: Types of Procedure
Expedited
Arbitration
10%
Arbitration
49%
Mediation
41%
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO Cases:
Remedies, Value, Numbers, Locations
• Remedies: damages, infringement declarations,
specific performance
• Value: from Euro 20,000 to US$ 600 million
• Numbers: some 200 (see WIPO web site)
• Locations: Europe, US, Asia (see WIPO web site)
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO Cases: Domestic / International
Domestic
25%
International
75%
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO Cases: General Subject Matter
Other
18%
Patent
46%
IT
22%
Copyright
9%
Trademarks
5%
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO Cases: Business Areas
Ot her
Pharmaceut icals
22%
14%
Luxury Goods
Mechanicals
2%
Chemist ry
18%
2%
Ent ert ainment
9%
Lif e Sciences
4%
IT/ Telecom
29%
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO Cases: (Contractual) Subject Matter
• Contractual
–
–
–
–
–
–
–
Patent licenses
Distribution agreements
Research and development agreements
Joint ventures
Software/IT transactions
Disputes involving copyright collecting societies
Trademark coexistence agreements
• Non-contractual
– Patent infringement
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO Case Results
24%
Not
settled
3%
Pending
19%
Pending
54%
Settled
73%
Settled
Mediation
27%
Award
Arbitration
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO Mediation Case Example
• R&D company disclosed patented invention to
manufacturer during consulting contract, without
transfer or license of patent rights
• Manufacturer started selling products which R&D
company alleged used its patent
• Negotiation of patent license failed; threat of multijurisdictional infringement proceedings
• Parties:
– Submitted to WIPO Mediation
– Worked with WIPO-appointed mediator
– Agreed license and new consulting contracts
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO Arbitration Case Example 1 (I)
• Asian inventor granted exclusive license over a
European patent and five US patents to US
manufacturer
• Clause provided that disputes whether royalties had
to be paid in respect of products manufactured by US
party be resolved through WIPO Expedited Arbitration
• US party rejected claim that its products embodies
technologies covered by the licensed patents and
refused to pay royalties
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO Arbitration Case Example 1 (II)
• Inventor initiated WIPO case
• Center appointed sole arbitrator under WIPO
Expedited Arbitration Rules
• Arbitrator had to consider whether products infringed
the ‘claims’ asserted for each of the patents and
whether patents had been ‘anticipated’ by ‘prior art’
–
–
–
–
Highly complex legal and technical issues
Business secrets, models, site visits
Eight days hearing
Final award in 15 months
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO Arbitration Case Example 2
• Finance agreement in connection with artistic
production
– German party - Swiss/Panamanian party
– WIPO Expedited Arbitration clause
– Each represented by US lawyers
• Urgent solution required: issue of contract
interpretation under German law
• WIPO appointed Germany-based US arbitrator
• Short deadlines for written submissions
• One-day hearing
• Award rendered five weeks after commencement of
arbitration
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO Arbitration Case Example 3
• Major agreement for creation of web presence for
popular national newspaper
– WIPO Mediation followed by WIPO Expedited Arbitration
• Mediator appointed; no settlement, but mediation
narrowed down and informed the issues
• Arbitrator appointed; parties settled after hearing
• Total timeframe: within eight months from
commencement
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
General Mediation Developments
• Growing acceptance
– Corporate dispute policies
– Corporate pledges
– Client expectations
– Institutional integration (e.g. UK Patent Office)
• Professionalization of the mediator profession
• Party focus on preparation for mediation
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
General Arbitration Developments
• The impact of the globalization of commerce
• Convergence of procedural norms, e.g.
– UNCITRAL (Model Law, Notes on Organizing Arbitral
Proceedings, work on interim measures, revision of Rules)
– IBA (Rules of Ethics, Guidelines on Conflicts of Interest,
Rules on the Taking of Evidence)
– Others (e.g. ABA, AAA, ICC)
•
•
•
•
•
Multi-party arbitration
Electronic discovery (US)
How to contain process and cost
Settlement in arbitration
Increasing use of information technology, including
online facilities (e.g. WIPO ECAF)
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
Using IT to Facilitate ADR
• Purposes
– Facilitate case communication (process)
• Time and cost
• Includes recording and submitting evidence
– Enhance result (product)
• Standard tools
– Email, Internet, ‘Video conferencing’
• Hearings, meetings, witnesses, deliberations
• Custom-made applications
• e.g., WIPO ECAF
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO Electronic Case Facility (‘ECAF’)
http://www.wipo.int/amc/en/ecaf/index.html
• Web-based electronic case file
– For WIPO cases (but also used under America’s Cup
Rules)
– Facilitates online communication and storage
– Submission in most common formats (word, pdf, others)
– Searchable by author, date, subject title
– Email alerts
• Case management information
– Names and contact details
– Case overview
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO ECAF: Case File
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO ECAF: Case Management
 Core case information at-a-glance
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO ECAF: Envisaged Benefits
• Case Communication and Management
–
–
–
–
–
Easy
Instant
Centralized
Location-independent
Secure
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
WIPO ECAF: Security
• Authentication
– ECAF username
– ECAF password
– RSA SecurID password
• Changing passcode generated by RSA SecurID (Valid
only for 60 seconds)
• Encryption
– Modern SSL (Secure Socket Layer) system
• Firewall protection
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva
More Information on the
WIPO Arbitration and Mediation Center
• WIPO Center website:
http://www.wipo.int/amc/en/
• WIPO Center email:
[email protected]
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LESI Manila Workshop, June 10, 2009, WIPO IP ADR, Erik Wilbers, WIPO Center, Geneva